'Good Causes' May Be Losing Britain's Lotto

LONDON -- As its popularity far outpaces expectations, Britain's new National Lottery is proving to be an unexpected bonanza for everyone entitled to a share of its earnings.

But the vast funds suddenly available for "good causes" have provoked disputes involving the many organizations designated to receive the windfall benefits.

Under the government's regulations, 28 percent of the lottery pie is divided equally among five groups: the arts, charities, sports, the national heritage and the Millennium Fund for monumental projects.

The argument centers on the beneficiaries of the spoils. Various critics are aghast, for instance, that medical research so far has been allocated nothing -- while stadiums are to be built with sports' share of the funds.

And when the Heritage Lottery Fund, which shells out for historic sites and museums, paid $18 million to Winston Churchill's grandson this spring for the British wartime leader's papers, the news caused a serious outcry.

Similarly, some critics object to the arts' lottery millions going to the refurbishment of opera houses and ballet theaters where tickets for performances command prices only the well-to-do can afford.

Further, second-string charities that collect locally complain that their sources of funds are drying up, because many small donors prefer to take a gamble on the lottery with its astronomical returns.

The National Lottery is pulling in sales that should amount to about $8 billion within a year, with $2.25 billion available for the worthy causes. Of the remainder, 50 percent goes for prizes, 12 percent to the government and the rest to retailers and the operator.

The lottery's huge success, polls show, is partly because women and young professionals seem attracted to it as an acceptable way to gamble.

In the field of the arts, the Arts Council has set up a distributing commission, and the recipients have included the Sadler's Wells Theatre, the Cambridge Arts Theatre and the British Film Institute.

But the arts funds are limited to capital improvements, and many commentators have complained that giving millions to the opera and theater and ballet groups still leaves ticket prices beyond the reach of most.

In response, the Arts Council has suggested that lottery ticket buyers be given discounts to movies, operas, theaters, art galleries and museums.

Lord Gowrie, chairman of the Arts Council, insists that the nine-member board is diligent in allocating funds to deserving projects. The most controversial payouts are in the charities area.

After sampling opinion from 7,500 groups allied with charities, the National Lottery Charities Board decided to focus on the poor and underprivileged.

At first, this ruled out medical facilities, including research -- on the ground that health, like education, is directly funded from the Treasury.

However, after widespread criticism, the charities board says it will extend its largess to medical research. But one cancer charity in Wales claims that it has had to shut its own lottery because of the national competition, thus losing about $2 million annually.

Diana Garnham of the Association of Medical Research Charities estimates that all charities will lose about $320 million a year as a result of competition from the lottery.